Mayors and other local leaders will soon have a new tool to analyse how attractive their cities are to investors.
The “Investable Cities Index” is the latest addition to the World Council on City Data’s work with standardised city metrics for urban performance.
The World Council on City Data (WCCD) announced the new initiative at the Global Cities Summit, a three-day meeting of officials from local and national government, the private sector and academia, taking place im Dubai this week.
The three-year-old council is based at the University of Toronto and has been involved primarily in spearheading a series of global standards by which cities can compare themselves along hundreds of metrics.
“Cities are very interested in being investable. They want to make sure they prosper,” said Patricia McCarney, the council’s president and chief executive.
“Budgets are always tight for cities. They have to figure out how to build a strong, robust city that builds a strong, robust economy.”
The index is in the process of being finalised and should be ready by mid-year. It will incorporate key indicators from the ISO 37120 standard, a global benchmark for how cities perform in term of services and quality of life.
The index will draw upon, for instance, the standard’s metrics around safety, crime rates, air quality, quality of services and governance, with the aim of showing how these affect a company’s ability to do business in a particular city.
Budgets are always tight for cities. They have to figure out how to build a strong, robust city that builds a strong, robust economy.
Patricia McCarney, president and chief executive, World Council on City Data
Mayors and other city leaders gathered here this week emphasised the value of standardised data for a range of aims, including helping officials understand what attracts investors.
The Investable Cities Index could help inform decisions around a city’s weak points and how to compensate for those, said Robert Elbrink, with the Dutch city of Eindhoven.
Cities benefit from having reliable data that allows them to compare themselves to other cities, and to identify strengths and weaknesses in a global setting, said Maurizio Bevilacqua, mayor of Vaughan, Canada.
“If we are low-ranking somewhere compared to the rest of the world or other cities, it’s a wake-up call for us,” he said. “It’s very important to understand where you fit in.”
About five years ago, Bevilacqua recalled, the WCCD’s McCarney pointed out to him that Vaughan was one of the few cities of its size in Canada that did not have a hospital. That understanding informed Vaughan’s recent announcement that it is building a USD 1.8 billion health facility, he said.
What makes a city investable?
For cities to be attractive to investors, they need to fulfil multiple criteria. And while these will inevitably vary by the investor, there are some commonalities in terms of needed information, experts at the Global Cities Summit said. (Citiscope is a media partner of the summit.)
All investors, for instance, are interested in a city’s strong talent base, its ability to create an ecosystem of complementary industries, and government support that makes it easier to do business, said Sunil Bhaskaran, chairman of Jusco, a subsidiary of Tata Steel that provides municipal services to the city of Jamshedpur in India.
But they’re also keenly focused on a city’s liveability and good urban development, he noted.
An investable city is a “city of opportunities” — one that has a clear understanding of its strengths and is “not trying to be everything to everybody,” said Hazem Galal, global leader for cities and local government at the international consultancy PwC.
When looking to invest, large multinational corporations seek out cities that have invested in infrastructure, said Birgit Kredel, corporate vice president of Siemens.
For example, in December 2016, Siemens opened a new factory to manufacture wind turbine blades in the city of Hull in the United Kingdom, an investment of roughly USD 380 million.
The city was attractive to the multinational company because local leaders already had invested in basic infrastructure, such as upgrading Hull’s port and broadband capacity, Kredel said. The city also had a skilled local workforce that Siemens could draw on.
City leaders looking to capitalise on the potential of reliable urban data to inform their investment opportunities also need to think about the crucial step of data analysis, said Kredel. They need to start with “use cases”, identifying crucial issues and problems — for instance, air quality, she said. Then they need to take the right data, combine it smartly and analyse it to find problems.
Supporters say the new index should help city officials prioritise that kind of information.
“That’s exactly what cities want to know,” WCCD’s McCarney said in an interview. “A lot of investment-driven, ‘competitive city’ analytics — they’re very interested in the financials, which is a great starting point.
But we also know that this data is … also really important for investment. Clean air, safe cities and high education degrees — all of those things that we measure are really about investible cities, as well.”
This story was published with permission from Citiscope, a nonprofit news outlet that covers innovations in cities around the world. More at Citiscope.org.